The article is transferred from the 35 bucket WeChat public account Author: Zhang Yujie
Recently, as one of the vertical media in the field of agriculture and food, 35 Dou participated in the "Development and Application of China's Innovative Food Raw Materials and the Road to the Sea" expert dialogue salon hosted by Meiankang, which brought together many experts and scholars in the field of food research and representatives of industry leaders to jointly explore the potential of local resources, develop innovative food raw materials with independent intellectual property rights, and actively promote them to the international market and other topics to carry out in-depth discussions.
At present, the food industry in mainland China has entered a period of deep transformation oriented by "safety and health", and with the increasing attention of consumers to health and nutrition, the market demand for functional foods is growing. According to the preliminary statistics of the Prospective Industry Research Institute, the scale of the mainland functional food market will reach 352.3 billion yuan in 2023, with an average annual compound growth rate of 6% from 2016 to 2023, and the industry scale will grow steadily.
From the perspective of the consumer side, under the tide of demand upgrading, C-end consumers, especially Generation Z, have a stronger driving force for health improvement and are more willing to pay for new foods with functions, which also provides a steady stream of endogenous power for the innovation and development of enterprises.
However, although the market size of functional food in mainland China has shown a continuous growth trend driven by consumption upgrading, its upstream functional food raw material industry is facing a series of challenges.
Figure: Pain points of functional food raw materials industry, drawn by 35 buckets
Four major challenges of product standardization, dose-effectiveness relationship, market education and scientific research validation
In the in-depth exchanges with 6 industry experts, 35 Dou frequently heard them raise issues such as "unclear standards, lax supervision, and high approval thresholds", which seems to have become an industry problem that everyone generally agrees on.
In the field of functional foods, the safety and efficacy of products are at the heart of the concerns of consumers and regulators. In addition, functional food ingredients must go through a strict approval process before entering the market. However, the complexity and length of the approval process often challenges the speed of market response and innovation of companies.
At this stage, there are few types of functional raw materials approved for ordinary food production in mainland China, mainly focusing on sodium hyaluronate, collagen, GABA and probiotics. Therefore, the high approval threshold and the small variety of raw materials are the first problems that need to be solved.
Figure: Sodium hyaluronate concept map Source: Bloomage Biotech official website
Although the mainland has set relatively high access standards for functional food raw materials, there is still room for improvement in the actual market supervision process, which makes the quality standards of functional food raw materials and their products in the market inconsistent.
"Nowadays, there are many new food products with different functions on the market, and it is the responsibility of companies to ensure that the products they produce or sell have been rigorously audited for their quality, safety and efficacy, so as not to mislead consumers or make them feel that they have paid an unnecessary 'IQ tax'. Lina Su, senior manager of food for China at the United States Pharmacopeial Convention (USP).
Therefore, lax market supervision and uneven product quality are one of the challenges for functional food raw materials and downstream markets.
In this regard, Dr. Yuan Peng, director of the Food Engineering R&D Department of China Food and Fermentation Industry Research Institute, also expressed the same opinion. "In order to cut costs, some companies may resort to adulteration, such as mixing cheap extracts with high-priced core ingredients, resulting in the authenticity of the raw materials cannot be guaranteed. ”
Zhong Liang, the founder of Youwei Food, also said that the current market lacks uniformity and clarity in the certification standards for raw materials. Taking blueberries as an example, different varieties of blueberries have different nutritional values, but they are often uniformly labeled as blueberries or blueberry extracts in the market. This ambiguity makes it difficult for consumers to accurately judge the true value and active ingredient content of a product at the time of purchase.
Figure: Blueberry concept map *Generated by Wenxin Yiyan AI model
Secondly, in addition to the blurring of the boundary between regulation and product standards, the unclear relationship between quantity and effect is also a problem faced by the industry. Dr. Yuan Peng said that although many raw materials claim to have hypoglycemic and hypolipidemic effects, in practical applications, due to the lack of research depth or high cost, the addition of these raw materials is often difficult to achieve the expected experience effect in the product. This not only makes consumers doubt the experience of the product, but also weakens the competitiveness of related products in the market, which has a negative impact on the healthy development of the industry.
"When emphasizing the health benefits of functional foods, consumers tend to focus on the content of a specific ingredient in an ingredient, such as the anthocyanins found in blueberries. However, there is currently no uniform standard for these specific ingredients in the market, making it difficult for consumers to judge the true effectiveness of the product. Zhong Liang, founder of Youwei Food, said.
Thirdly, the lack of awareness of functional food raw materials on the consumer side is also a problem that needs to be solved urgently. The new generation of consumers is becoming more and more discerning about healthy food, and they are paying more attention to the scientific basis and R&D data of products. However, at present, the popularization of science about functional food raw materials in the market is not sufficient, and consumers lack sufficient information support when choosing products.
Finally, the compliance of promotional activities is also a concern for the industry. When promoting a product, some businesses may use exaggerated or disease-suggestive ways of promotion, which not only violates relevant regulations, but may also mislead consumers. Therefore, the promotion of raw materials needs to be carried out within a compliant, reasonable and reasonable scope to ensure that the rights and interests of consumers are protected.
When discussing the pain points of the raw material industry, Dr. Yuan Peng further emphasized the importance of scientific research in the development of the industry to 35 Dou. He pointed out that the current function and effect of many raw materials still lack comprehensive and in-depth research support, which has become a key factor restricting the development of the industry. Due to the lack of sufficient scientific evidence, the development and marketing of products have been limited. To this end, Dr. Yuan Peng emphasized that strengthening the clinical and scientific research of raw materials and improving the scientific basis and effect verification of products is an important means to promote the sustainable development of the industry.
It is not difficult to see that the functional food raw materials industry is facing pain points such as the ambiguity of the authenticity of raw materials, the unclear relationship between quantity and effect, the compliance of publicity and promotion, and the lack of scientific research and innovation. Specifically, factors such as the difficulty in certifying the source of functional food raw materials and the imperfect efficacy verification mechanism will also make enterprises face severe challenges in the process of improving product quality and building consumer trust.
The dual factors of policy acceleration and technological innovation drive industrial transformation
In the face of various pain points exposed in the functional food raw material industry, from the market confusion caused by unclear standard definition, to the low technological content of products caused by insufficient R&D investment, to the frequent product quality and safety problems that damage consumer confidence, the existence of these problems not only challenges the innovation ability and market reputation of enterprises, but also affects the health and trust of consumers. However, challenges and opportunities coexist, and facing up to the problem is the first step to solving it.
At the approval level, in 2023, the approval speed of new food raw materials will be significantly accelerated. According to the statistics released by the Food Research Institute, in 2023, a total of 17 new food ingredients have completed the stage of public consultation, and 12 raw materials have been successfully approved. Compared to 2022, the number of new food ingredients successfully approved during the year saw a significant increase of 140%.
Figure: Public consultation and approval of new food raw materials in the past 5 years Data source: Food Research Hui, drawn by 35 buckets
This change not only reflects the increased efficiency of regulatory vetting of new food ingredients, but also shows that the functional food industry is active in innovation and ingredient development.
At the policy level, the mainland has promulgated a number of policies since 2016 to regulate the development of functional foods. From 2016 to 2020, most of the policies promulgated were normative regulations, which put forward requirements for the development of the industry in terms of functional food labeling, publicity, and functional food safety. Judging from the newly promulgated policies in 2021, the raw materials of health food in mainland functional foods have been further expanded.
At the beginning of 2021, China's National Health Commission (NHC) issued the "Announcement on 15 "Three New Foods" such as Cicada Flower Fruiting Body (Artificial Cultivation), officially approving hyaluronic acid as a new food raw material that can be used for ordinary food additives. Since then, the application scope of hyaluronic acid has expanded from being limited to health food raw materials to a wider range of food categories, including milk and dairy products, beverages, alcohol, cocoa products, chocolate and chocolate products, candy, frozen drinks, etc., which has brought new growth points and market opportunities to the food industry.
Table: Interpretation of the key content of policies related to the functional food industry at the national level from 2016 to 2023 Data source: Qianzhan Industry Research Institute, drawn by 35 buckets
At the technical level, the R&D and production of functional food raw materials are inseparable from bioengineering technology, extraction and purification technology, and synthetic biology technology. Specifically, it can include microbial fermentation, genetic engineering, supercritical fluid extraction, separation and purification, etc.
At present, the use of synthetic biology technology to synthesize natural active raw materials is an innovation hotspot in the field of functional food raw materials, if it can be replaced or partially replaced by synthetic biotechnology plant extraction, it not only has great economic value, but also has great social significance. However, the structure of natural active ingredients is usually more complex and difficult to synthesize, and only a few companies have broken through the technical barriers, and Henglu Biology is one of them.
Henglu Biotech was established in 2018, and before that, the team had completed the small-scale test results of HMO (human milk oligosaccharides) in the laboratory. In view of this major breakthrough, Fang Xu, the founder of Henglu Biotechnology, decided to establish a company dedicated to the industrialization of synthetic biology. In terms of the number of patents, Henglu Biotech has ranked fourth in the world in the field of HMO, and it is far ahead in China.
"In the next 5-10 years, synthetic biology will play a very important role in the big health industry, cosmetics, functional foods and medical cosmetology, especially in the production of high value-added active raw materials. Fang Xu, the founder of Henglu Biology, told 35 Dou.
Figure: The way to break the game of functional food raw materials, drawn by 35 buckets
New development opportunities under the path of internationalization: raw materials going overseas
With the rapid development of functional foods in the mainland market, the market competition is becoming increasingly fierce. Many companies have been pouring into this field, resulting in a gradual increase in market saturation and a squeeze on profit margins.
In addition, although the domestic market is huge, with the intensification of competition and the increasing diversification of consumer demand, enterprises are facing the dual pressure of product innovation and market expansion. Going to sea is one of the ways to effectively resolve the current contradictions.
Going overseas can not only open up new growth points for enterprises, but also promote enterprises to improve product quality and management level and enhance the international competitiveness of brands through the high standards and strict requirements of the international market.
Previously, Lu Guoqing, chairman of Chenguang Biotechnology, also said that many Chinese consumers buy foreign brands of dietary nutritional supplements, which are commonly referred to as health foods, about 80% of which are produced in China. This fully shows that the mainland has become a veritable country of functional food raw materials.
In this context, the export of raw materials has become an inevitable trend in the development of the functional food industry.
However, for domestic enterprises, in order to enhance their comprehensive competitiveness, they not only need to strictly control product quality, but also need to pay attention to product differentiation and innovation, and develop products with unique functions or advantages.
At present, there are a large number of similar products in the international market, and many raw materials show a homogenization trend, lacking uniqueness and innovation. For customers with a focus on international brands, there are so many options to choose from when it comes to choosing the right supplier of functional food ingredients.
Dong Jing, general manager of Peisheng Testing, told 35 Dou that how to stand out in the fierce competition and meet the requirements of international brands is a difficult problem. Dong Jing, general manager of Peisheng Testing, believes that domestic enterprises should actively seek breakthroughs and innovations, and enhance market competitiveness by improving product differentiation, so as to stand out in the functional food raw material market.
At the same time, they also need to pay attention to the needs and trends of the international market, and understand the sourcing standards and requirements of international brands, so as to better meet the market demand and gain international recognition.
"For example, the certification of sustainable development is an important part of domestic enterprises going overseas. This not only involves hard indicators, but also includes social responsibility and management system construction and other requirements. Dong Jing, general manager of Peisheng Testing, said.
She has 20 years of working and living experience in the U.S. FDA/USP, and is familiar with the regulations and declaration procedures of new food ingredients in the United States, the European Union, Australia, New Zealand and other countries, and has helped more than 10 Chinese products apply for GRAS (GRAS is the abbreviation of Generally Recognized As Safe, which is widely known as "Generally Recognized Safe", which was promulgated in the United States in 1958. Food Additives Amendments) or SELF-GRAS (GRAS self-declaration, formed by a qualified expert group to recognize the safety of the substance, such GRAS does not submit notifications to the US FDA, does not go through FDA review, and generally will not be disclosed to the public), covering synthetic biological protein raw materials, chemical synthesis raw materials, plant extracts, bacteria and other types.
Si Rong told 35 Dou that the international cooperation prospects of China's functional food raw materials are very broad, and the development from low-end bulk raw materials to high-end functional innovative raw materials is an inevitable trend. The continuous improvement of the supply chain system, the continuous improvement of R&D capabilities, the strengthening of policy support and the growth of demand in the global market are all "high-quality soil" for Chinese enterprises to go overseas.
"Increasing innovation and research and development efforts to meet the market demand for new raw materials, and obtaining international market access qualifications, such as FDA GRAS, NDI, EU NOVEL FOOD or ANZ FSANZ certification, etc., is an effective means for Chinese functional food raw material enterprises to enhance their competitiveness in the international market. Si Rong told 35 Dou.
Through in-depth discussions with 6 experts on the functional food ingredients industry, we can clearly see the development direction and potential opportunities of the industry. In the future, with the advancement of scientific and technological innovation and internationalization strategy, China's functional food raw material industry is expected to achieve greater breakthroughs and development.
At the same time, we also hope that the vision jointly depicted by industry experts can become a reality: we hope to see more Chinese functional food raw materials pass international certification and approval, play a greater role in the international arena, go global, become an important part of the global health industry, and work with industry partners around the world to build a healthy, sustainable and innovative functional food raw material industry.
This vision is not only a high standard within the industry, but also a positive response to the diverse needs of consumers around the world.
Special Thanks (in order of interviews):
Lina Su is Senior Manager of Food/Dietary Supplements/Herbal Medicine for China Region of the United States Pharmacopeial Convention Commission
Fang Xu is the founder, chairman and chief scientist of Henglu Biotechnology, and a professor of Shandong University
Yuan Peng is the director of the food engineering R&D department and senior engineer of China Food and Fermentation Industry Research Institute
Dong Jing is the general manager of Shanghai Peisheng Testing Co., Ltd
Si Rong, CEO of Ankang and Head of International Regulatory Department
Zhong Liang is the founder of Jiangsu Youwei Organic Food Co., Ltd
Note: If the data in the article involves 35 interviews with reporters, they are all provided and confirmed by the interviewees.